Goldman Sachs (GS) sees the price of gold bullion declining in coming months as interest rates move higher.
The Wall Street investment bank lowered its year-end forecast for gold’s price, citing the potential for more interest-rate hikes from the U.S. Federal Reserve.
Goldman Sachs’ lead commodities analyst Daan Struyven sees the price of gold ending 2026 at
$4,150 U.S. an ounce, down from a previous year-end target of $4,650 U.S.
Gold’s price is currently at $4,070 U.S on Nov. 6, down from a record high of just over $5,500 U.S. set in January of this year.
As a non-yielding asset, gold tends to perform best when interest rates are low and declining rather than marching higher.
Several central banks around the world, including in the U.S., Canada, and the United Kingdom have raised interest rates since Sept. 1 of this year to combat stubborn inflation.
Financial markets are currently pricing in a 71% chance that the U.S. Federal Reserve will raise interest rates by another 25 basis points at its December meeting.
Despite its hawkish turn, Goldman Sachs sees gold’s price rebounding in 2027, with the investment bank forecasting that the price will reach $4,800 U.S. an ounce next year.
GS stock has gained 10% over the past year to trade at $868.95 U.S. per share.
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